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| Sunday, 25 September 2005 |
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Equity enhances power of growth to reduce poverty - World Development Report 2006 Equity, defined primarily as equality of opportunities among people, should be an integral part of a successful poverty reduction strategy anywhere in the developing world, says the World Bank's annual 2006 World Development Report. "Equity is complementary to the pursuit of long-term prosperity,"said Francois Bourguignon, the Bank's Chief Economist and Senior Vice President for Development Economics, who guided the team that produced the report. "Greater equity is doubly good for poverty reduction. It tends to favour sustained overall development, and it delivers increased opportunities to the poorest groups in a society." Equity and Development, produced by an eight-member team of authors led by economists Francisco Ferreira and Michael Walton, makes the case for equity, not just as an end in itself, but because it often stimulates greater and more productive investment, which leads to faster growth. The report shows how wide gulfs of inequality in wealth and opportunity, both within and among nations, contribute to the persistence of extreme deprivation, often for a large proportion of the population. This wastes human potential and in many cases, can slow the pace of sustained economic growth. Pro-equity policies can bridge these gulfs, the authors conclude. The objective is not equality of incomes, but rather to expand access by the poor to health care, education, jobs, capital, and secure land rights. Crucially, equity requires greater equality of access to political freedom and political power. It also means breaking down stereotyping and discrimination, and improving access to justice systems and infrastructure. "Public action should seek to expand the set of opportunities of those who have the least voice and fewest resources and capabilities", World Bank President Paul Wolfowitz says in the foreword to the report. "It should do so in a manner that respects and enhances individual freedom, as well as the role of markets in allocating resources." To increase equity within developing countries, the report calls specifically for policies that correct for persistent inequalities in opportunity, by levelling the economic and political playing fields. Many such policies will also increase economic efficiency and correct market failures. |
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